Latin American fibre-optic connections to hit 5.1m this year

Fibre-optic (FTTH/B) connections in Latin America will hit 5.1 million connections by the end of 2015, according to Pyramid Research’s latest Fixed Communications Demand Forecast, with fixed lines reaching 163.8 million.

Fixed lines are predicted to grow by 2.3 per cent from the 2014 figures, while FTTH/B connections are predicted to increase at a CAGR of 34.9 per cent over the next five years. The company expects Latin America to have 181.9 million fixed broadband lines by 2020.

“Growth within fixed communications markets will be mainly driven by the increase in broadband lines,” said Marcelo Kawanami.

The growth in fibre connections will see them account for 6.9 per cent of broadband lines by year-end, up from 5.1 per cent last year. Yet xDSL remains the broadband technology most widely used on the continent, representing 57.5 per cent of total broadband lines in 2014.

“Despite the effort from operators to leverage FTTH/B services, prices charged for broadband services through fibre technology remain high, and service coverage is still restricted to selected areas within major cities,” said Kawanami.

Pyramid Research expects xDSL to remain dominant in Latin America in the next few years, still holding over 40 per cent of all broadband connections at the end of 2020.

Traditional voice services carried through circuit-switched networks will decline over the next five years by a CAGR of 6.3 per cent, this in spite of increased adoption of VoIP services. Yet Pyramid Research predicts growth in internet service revenue at a CAGR of 6 per cent in the region between 2015 and 2020. The company believes the Latin American fixed communications service market to be worth US$44.8 billion in 2015.

“In all major Latin American countries, governments have developed National Broadband Plans to foster the expansion of broadband in remote locations which have not been historically served due to the high cost of network deployment and uncertain revenue potential,” said Kawanami.

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